OREANDA-NEWS. December 02, 2013. “Under 2013-2024 Strategy for developing competition and antimonopoly regulation in Russia state and municipal unitary enterprises shall be liquidated in competitive sectors of the economy except enterprises in the field of national defence and state security”, said Stats-Secretary, Deputy Head of the Federal Antimonopoly Service (FAS Russia) Andrey Tsarikovskiy at the III International BRICS Competition Conference in New Delhi.

“In Russia the share of state and municipal companies in the economy is the largest in comparison with other European countries. State and municipal unitary enterprises in Russia sometimes control up to 100% of a local market and are involved in free economic relations without being market entities. It certainly stultifies the idea of competition and encourages an uncontrolled growth of administrative burden upon business”, pointed out Andrey Tsarikovskiy.

He emphasized that “companies with state participation violate the antimonopoly law by transferring property to the authorized capitals with further alienation, granting preferences in the form of subsidies and assigning powers. Lately, collusions between economic entities and government officials tend to take place more frequently, which restricts competition and hampers development of a healthy entrepreneurial environment. Out job is to prevent such actions through tight sanctions and make sure that representatives of the authorities and unfair businessmen swallow medicine if they are involved in such violations”.

Andrey Tsarikovskiy added that in the amendments to the Federal law “On Protection of Competition” FAS proposed a mechanism, which would prevent forming state and municipal unitary enterprises on competitive markets and liquidate the existing ones. Their property can be transferred to state ownership and then either privatized or leased to small and medium business, and the state assets that cannot be privatized should be given to private companies under concession.

“FAS also proposes that establishing all state and municipal unitary enterprises as well as all legal constructs with the state share exceeding 50% shall be subject to a mandatory approval by FAS. Such control will help support normal competition for small and medium business at the local level”, summed up Deputy Head of FAS.

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The main competitive market where companies with state participation operate include road construction, medical and pharmaceutical services, transportation services, infrastructure of natural monopolies, educational services, provision of amenities, landscaping, security services and ceremonial services.